Professional Documents
Culture Documents
Outline
Nonstore retailing
Catalog Direct-Selling Orgs (DSOs)
Electronic Channels
Market Opps Service Output Provision and Demand-Side Gaps Channel Flow Performance and Supply-Side Gaps Coordination Challenges
Direct Selling is the sale of a consumer product or service in a face to face manner away from a fixed retail location. Typically high reliance on personal selling E.G.s: Amway, Mary Kay, Herbal Life, Avon, and Tupperware. Top 5 DSO countries - sales (Canada is 10th):
1. 2. 3. 4. 5. Japan USA Brazil Germany Korea
Balance growth of Network vs. Sale of products (often based on personal consumption) Ilegal Pyramid Schemes:
Fraudulent mechanisms by which new recruits are required to pay a nonrefundable fee for becoming a distributor and the distributors only reward is this fee (there is no sale and/or consumption of a product or service). Ultimately the last layer of the pyramid will make no money from anyone (population maximized), yet the highest in the pyramid earns money from everyone.
Electronic Channels
any channel that involves using the Internet as a means of reaching the enduser or any channel for which the consumer literally buys on-line. B2C or B2B.
May reduce costs (EDI integration, VMI, and CRP systems) Physical Possession inventory, pick, pack, ship costs increase. 3rd Party expert business is on the rise as a result (FedEx). Promotion impacts on alternative channels such as retail stores Negotiation may decrease or increase in intensity Risking increased fear about disclosure of financial information online, reduce risk of holding inventory (ship direct from manufacturer) Ordering Technology has improved effectiveness of ordering dramatically (reducing operating cost and increasing entry cost) Payment existence of electronic payment from backing has facilitated e-commerce growth. Trust issues have induced new 3rd party members like PayPal.
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